With rising energy demands, industries such as cement, steel, and textiles, along with coal-fired power plants, rely heavily on a consistent and high-quality coal supply. Local coal reserves are limited in quantity and quality, making imports crucial for maintaining efficient production and energy generation.
Syed Mustafa Ahmed, Director at Awan Trading Co. (Pvt) Ltd (ATCL), one of Pakistan’s leading coal importers, mentioned that they have played a crucial role in ensuring a steady coal supply for power plants, cement factories, and the textile industry.
In the calendar year 2022, ATCL imported 1,072,000 metric tons of coal. This figure decreased slightly to 990,000 metric tons in 2023 but saw a significant rise to 1,992,000 metric tons in 2024. Despite fluctuations in import volumes, company has consistently demonstrated its commitment as a responsible taxpayer, contributing over 27 billion to the national treasury in the past two years.
“Our company has been at the forefront of coal imports, supplying key power plants such as Sahiwal and Port Qasim and introducing high-quality coal from countries like Russia, the USA, Australia, Indonesia and South Africa, Syed Mustafa told.
Pakistan faces major challenges in securing coal imports due to an ongoing economic crisis, bank refusal to open Letters of Credit (LCs), and a depreciating rupee that drives up costs. Poor infrastructure and storage further disrupt supply chains. Environmental concerns and pressure to shift to cleaner energy also add to the complexity. High import tariffs, regulatory fees, and policy instability make coal expensive and deter investment. Coal power plants lack emission control technology, while inadequate transport oversight and regulated tariffs reduce profitability.
To ensure steady supply and economic stability, the government needs to streamline regulations, upgrade port facilities, and strengthen the coal transport network.
Commenting on the adoption of local coal, he emphasized the necessity of imported coal over local coal, citing quality, efficiency, and supply reliability as key factors. “Pakistan’s local coal has high sulfur and moisture content, making it less suitable for large-scale industrial and power sector use. He further stressed that currently local coal reserves/ Production are not sufficient to meet the country’s growing energy demands, making imports essential to sustain industrial operations and power generation.
Another Primary concern is the expense of transporting Thar coal to the power plants, e.g., Sahiwal and Port Qasim due to the absence of a railway connection with the Thar coal site. In 2021 alone, about 67% of the country’s total coal consumed (28.1million tons) was imported. Compared to other fuels, coal-based generation costs in Pakistan remained low compared to RLNG and RFO.
Pakistan’s power sector contribution to global power sector emissions is hardly 0.4% compared to over 38% by China, 11% by the US, 9% by India, and 6% by Russia in 2021. Still, as per the Global Climate Index 2021, Pakistan is the 8th most vulnerable country to climate change. The technology used in coal-fired power plants is vital from an environmental perspective.
ATPL has taken impactful steps to reduce its environmental footprint, including deploying water bowsers to suppress coal dust and prevent combustion, and planting over 700 trees on-site to boost local biodiversity.
Highlighting key milestones, Mustafa noted, “ATCL pioneered coal imports at Karachi Port in 2003 and has since introduced American, Colombian, Canadian, and Australian coal to Pakistan.” Landmark achievements include a 10-year coal transport deal with Pakistan Railways and discharging the first vessel at Pakistan International Bulk Terminal (PIBT).
Amid Pakistan’s 2011-12 energy crisis, ATCL played a vital role by promoting sized coal as a cost-effective substitute for furnace oil, slashing industrial energy costs in cities like Lahore and Faisalabad, especially across textile, steel, and chemical sectors.